Early Call On Chicago

09/05/11 -- There's no sign of an extension to last week's commodities slump so far, with crude and other energies, metals and softs mostly starting the week posting significant gains. That's lent a positive tone to grains, adding to some bullish fundamentals, sending Globex wheat up 12-17c overnight, with corn up around 6-10c and soybeans up 6-8c.

Temperatures in the 90's over the weekend, touching low 100's in places, combined with high winds will have caused more damage to an already hurting badly US HRW wheat crop. The USDA will report on crop conditions tonight, so we can probably expect further declines from last week's 34% good/excellent. Ironically of course further north in the Dakotas what wouldn't they give for some warmth and dryness to help spring wheat plantings advance from just 10% done last week as opposed to 43% a year previously.

The USDA will also report on corn planting progress, that was just 13% done last week. The trade is hoping for a figure around 35-40% this time round. That sounds a bit optimistic to me, but we shall see.

Whilst bullish stories exist for corn and wheat, there aren't too many for soybeans so they may be the weakest leg for the time being.

South America is just about done harvesting another large crop, record in the case of Brazil. China seems to have packed up it's bat and ball as far as soybean purchasing goes.

The Chinese renminbi, or yuan, has hit an all-time high against the dollar this morning.

Potentially "drought busting" rains arrived for East, Central and South China over the weekend, with some places getting a reported 100mm between Sunday morning and 2 pm local time this afternoon.

Early calls on this afternoon's CBOT session: corn up 8-10c, beans up 6-8c, wheat up 14-16c.